Jaguar Land Rover owner Tata looks set to pick Somerset over Spain for car battery gigafactory
Hopes for the UK’s electric vehicle industry have been reignited as Jaguar Land Rover’s owner looks set to pick Somerset over Spain for a car battery plant.
Tata’s boss is expected to fly to London next week to finalise the multi-million-pound deal, which Chancellor Jeremy Hunt has been pushing for months, according to the BBC.
But Whitehall sources told the Mail that negotiations were still ongoing to secure the most significant investment in UK automotive since Nissan came to Sunderland in the 1980s.
Elon Musk has also said he is considering the UK for a Tesla gigafactory as the electric car maker ramps up production.
Deals with Tata and Tesla would significantly bolster Britain’s electric vehicle (EV) sector, which has had a rocky ride in recent months – from the collapse of Britishvolt to the crisis surrounding the lack of electric chargers.
Site: Jaguar Land Rover is expected to pick a site near Bridgwater in Somerset (pictured) for its new car battery gigafactory
There are also ongoing concerns over ‘rules of origin’ laws which could see tariffs of 10pc whacked on EVs exported to the EU that do not meet strict criteria.
Under current plans, 45 per cent of an electric car must be sourced in the UK or elsewhere in Europe to avoid export tariffs of 10 per cent.
The rule, which is set to come into force next year, was originally intended to boost the creation of domestic electric car battery industries and remove the over-reliance on foreign players, such as China and Japan.
But both the EU and the UK have failed to build enough factories to meet these production demands, meaning that most vehicles will not meet this standard and therefore must pay the tariff.
Stellantis, which owns Vauxhall and Citroen, told MPs last week that it would be unable to make EVs in the UK without changes to Britain’s agreement with the bloc.
Ford and Jaguar Land Rover also argued that the shift to EVs could be knocked off course unless the stricter rules are delayed.
Although Business Secretary Kemi Badenoch has said a solution would come ‘soon’, data from the Society of Motor Manufacturers and Traders (SMMT) underlines the scale of the threat.
More than eight in ten cars manufactured in the UK last month headed overseas, according to the figures, with over half of these going to the EU.
Manufacturers produced a total of 66,527 cars in April, up 10 per cent from the same period last year, the SMMT said, with the number of electric vehicles jumping 56 per cent year-on-year.
Mike Hawes, chief executive of the SMMT, said: ‘These figures show how exports, particularly to Europe, continue to be the foundation of British automotive manufacturing so we must do all we can to safeguard the competitiveness of these trading relationships.’